A new report from Colliers International says investment
in Ottawa's commercial real estate market surpassed $1.1
billion last year, a level not seen since 2003. According
to the report, office transactions led the way in 2005,
the most notable being CPP Investments' purchase of a 50-per-cent
interest in OMERS' Class A Constitution Square complex for
$118 million.

Following a year of government uncertainty the Ottawa office
leasing market rebounded in 2005, with vacancy dropping
from 12 per cent to 9.6 per cent. The biggest drop was seen
in the suburbs, while the downtown core saw a minimal decrease
to 4.2 per cent from 4.6 per cent a year ago. The completion
of a number of large deals over the year created a shortage
of large pockets of space (deemed as spaces over 100,000
square feet) in the region. When the dust settled, at year-end
2005 there were only two available options in the region
over 100,000 square feet, according to the report.

Ottawa also remains on track to have one of the lowest
industrial vacancy rates in Canada. While last year vacancy
edged up to 5.4 per cent, this year that number came tumbling
down to an impressive 3.2 per cent thanks to high demand,
increased construction costs and limited supply of vacant
industrial space. On pace with last year's performance,
the report says retail vacancy dropped to just under three
per cent for 2005, significantly below the five-year historical
average of 3.5 per cent. Despite predictions of a less-than-outstanding
2005 Christmas retail season, observers point to the Ottawa
retail market's continued resilience as a factor in the
drop.